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Blumenthal Fed Misses Critical Deadline To Roll Back Credit Rates Fees
Blog Post Date: Mar 03 2010
Blumenthal: Fed Misses Critical Deadline To Roll Back Credit Rates, Fees
By KENNETH R. GOSSELIN The Hartford Courant
Even as a sum of new protections for credit card users went into effect last Monday, the state attorney general disparage a key federal banking regulator for disrupting those efforts.
Attorney General Richard Blumenthal attacked the U.S. Federal Reserve for failing to meet another critical deadline Monday for implementing a provision that takes effect in August that could roll back interest rates and penalty fees.
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Consumer advocates say an extensive cross-section of cardholders have seen their interest rates and fees go up in advance of the credit card reforms implementation. On Aug. 22, credit card companies must start going over accounts of cardholders whose interest rates and fees have been increased since Jan. 1, 2009.
If market adapts, the cardholder's credit risk or other factors have develop, the credit card issuer must decrease rates and fees.
The Federal reserve was supposed to have rules ready on Monday, sketching details about what rate and fee hikes would likely be reversed.
Blumenthal said he would call for Fed chairman Ben Bernanke to give an explanation for why the rules are not ready and when they would be. By not meeting the deadline, the Federal reserve leaves the impression that protecting consumers is their least priority.
"By failing to meet the deadline, they send the message that it's business as usual despite the new act," Blumenthal said. "That message really needs to be met."
A spokesman for the Federal Reserve said Monday, "The Federal Reserve will announce proposed rules shortly for this provision under the credit card act."
The spokesman would not reveal detail or comment on why the deadline was not met.
Blumenthal has pushed credit card issuers to remove increases immediately to levels of Jan. 1, 2009 and has urged the Fed to support those efforts.
For months, Blumenthal has disparaged credit card issuers for raising rates and fees in advance of reforms taking effect. U.S. Sen. Christopher Dodd, the legislation's motivator, has reiterated those concerns, most recently at a press conference in Hartford last week.
Blumenthal is a candidate for Dodd's seat in Congress.
VIA Hartford Courant
Keyword: Credit Card
By KENNETH R. GOSSELIN The Hartford Courant
Even as a sum of new protections for credit card users went into effect last Monday, the state attorney general disparage a key federal banking regulator for disrupting those efforts.
Attorney General Richard Blumenthal attacked the U.S. Federal Reserve for failing to meet another critical deadline Monday for implementing a provision that takes effect in August that could roll back interest rates and penalty fees.
Apply Today! Discover More
Consumer advocates say an extensive cross-section of cardholders have seen their interest rates and fees go up in advance of the credit card reforms implementation. On Aug. 22, credit card companies must start going over accounts of cardholders whose interest rates and fees have been increased since Jan. 1, 2009.
If market adapts, the cardholder's credit risk or other factors have develop, the credit card issuer must decrease rates and fees.
The Federal reserve was supposed to have rules ready on Monday, sketching details about what rate and fee hikes would likely be reversed.
Blumenthal said he would call for Fed chairman Ben Bernanke to give an explanation for why the rules are not ready and when they would be. By not meeting the deadline, the Federal reserve leaves the impression that protecting consumers is their least priority.
"By failing to meet the deadline, they send the message that it's business as usual despite the new act," Blumenthal said. "That message really needs to be met."
A spokesman for the Federal Reserve said Monday, "The Federal Reserve will announce proposed rules shortly for this provision under the credit card act."
The spokesman would not reveal detail or comment on why the deadline was not met.
Blumenthal has pushed credit card issuers to remove increases immediately to levels of Jan. 1, 2009 and has urged the Fed to support those efforts.
For months, Blumenthal has disparaged credit card issuers for raising rates and fees in advance of reforms taking effect. U.S. Sen. Christopher Dodd, the legislation's motivator, has reiterated those concerns, most recently at a press conference in Hartford last week.
Blumenthal is a candidate for Dodd's seat in Congress.
VIA Hartford Courant
Keyword: Credit Card
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